5 Reasons to Invest in Canadian Commercial Real Estate
Given the uncertainty of the stock market and the abundance of “over-valued” investment opportunities available today, many investors are finding it difficult to achieve consistent returns.
Here are five great reasons why Canadian commercial real estate should be a part of your investment portfolio.
According to a recent report by CBRE Group Inc., Canada is becoming the ‘Switzerland of North America’ for commercial real estate, due to its record setting growth in 2017 and the fact that Canadian commercial real estate boasts the lowest downtown vacancy rates across North America.
2.) Consistent Investment Returns
Foreign investors are no longer viewing commercial real as an alternative asset class, as it has consistently performed well against the equities and bond markets and has continued to produce consistent returns, making Canada one of the most reliable commercial property markets in the world.
3.) Wealth Preservation
One of the best advantages of investing in commercial real estate investment is that it’s a tangible asset with real world value. The value of companies and their underlying stock price can quickly evaporate by over the course of days, if not hours.
Investments in “bricks and mortar” are much less susceptible to drastic value fluctuations as even during dire economic downturns, commercial real estate can still consistently produce rental income and be improved over time to retain value for investors.
4.) Capital Appreciation
Although commercial real estate values can fluctuate over time, Canadian markets have shown strong demand, which resulted in 2017 being a record year for Canadian commercial real estate with more than $43.1 billion in investments.
In comparison with the rest of the world, Canada was one of only four countries to have this level of success in 2017 and is poised to have another record year in 2018, as well. This will result in more growth and capital appreciation for investors in the months and years ahead.
5.) Income Generation
Commercial real estate is one of the best vehicles for passive income generation. Investors looking to supplement their retirement income and stretch their nest egg further should strongly consider adding income-producing commercial real estate to their portfolio.
Overall, there are plenty of reasons to invest in commercial real estate in Canada and savvy investors will be rewarded well with consistent returns and a growing asset values. Canadian property investors currently in the market should expect their holdings increase in value in the coming years, with yields far exceeding expectations.